Oil Almost Unchanged Ahead of US Stocks Data, Potential OPEC+ Cuts

Oil prices barely moved during Asian trade on Wednesday as the market awaited potentially mixed news on the supply front, with the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, expected to discuss output cuts and US crude stocks forecast to show a big build-up, according to Reuters. Brent crude futures fell 3 cents, or 0.04 %, to US$82.45 a barrel by 8:00 a.m. Saudi time. US West Texas Intermediate crude futures fell 1 cent, or 0.01 %, to US$77.76.

Both benchmarks have fallen for four straight weeks, and prices weakened further last week on growing concerns about the demand outlook. Investors remained cautious ahead of Sunday’s scheduled OPEC+ meeting, when the producer group may discuss deepening supply cuts due to slowing global economic growth. On Nov. 20, both contracts climbed about 2 % after three OPEC+ sources told Reuters the group was set to consider additional oil supply cuts when it meets on Nov. 26.

OPEC+ is likely to extend or even deepen oil supply cuts into next year, analysts have predicted. “While market consensus suggests Saudi Arabia and Russia will be extending voluntary cuts into 2024, any further cuts by other members will hold the key to future prices,” ANZ analysts wrote in a note.

Even if the OPEC+ nations extend their cuts into next year, the global oil market will see a slight supply surplus in 2024, the head of the International Energy Agency’s oil markets and industry division said on Tuesday. US crude stocks rose by nearly 9.1 million barrels in the week ended Nov. 17, according to market sources citing American Petroleum Institute figures on Tuesday. Gasoline inventories dropped by about 1.79 million barrels, while distillate inventories fell by about 3.5 million barrels. US government data on stockpiles is due on Wednesday.